This article was subject to double-blind peer review.
Contingent Commissions, Insurance Intermediaries, and Insurer Performance
Article first published online: 1 JUL 2013
© Risk Management and Insurance Review, 2013
Risk Management and Insurance Review
Volume 17, Issue 1, pages 61–81, Spring 2014
How to Cite
Ma, Y.-L., Pope, N. and Xie, X. (2014), Contingent Commissions, Insurance Intermediaries, and Insurer Performance. Risk Management and Insurance Review, 17: 61–81. doi: 10.1111/rmir.12004
- Issue published online: 3 MAR 2014
- Article first published online: 1 JUL 2013
This research investigates the relationship shared by contingent commission usage and insurer performance. We assess performance using both frontier efficiency and financial performance measures. Our findings reveal that the relationship is complex and varies across differing insurer business models. We find that nonusers of contingent commissions are more cost and revenue efficient than are users of contingents. However, among insurers that use contingents, relatively higher levels of use are associated with more efficient operations and also better financial performance. Additionally, these findings are conditioned on the type of distribution system the insurer employs.